Uber Rival GrabTaxi Pilots A ‘Welfare’ Program For Drivers In Southeast Asia

GrabTaxi, the SoftBank-backed Uber rival operating in Southeast Asia, is putting aside a portion of the $330 million in funding that it raised over the past 18 months to create a ‘welfare fund’ for its drivers.

The company is piloting the initiative in Singapore initially, where it has allocated S$3.5 million (US$2.8 million) to provide financial support for drivers in cases of health issues, accidents and “crisis support.”

The company didn’t specify how many of the 60,000 drivers that it claims overall are based in Singapore, but it did reveal that it will set aside S$300 (US$240) per driver per month. Drivers qualify for the fund based on how regularly they use GrabTaxi and the standard of their service.

Lim Kell Jay, general manager for GrabTaxi Singapore, told TechCrunch that standards would be based on a combination of metrics like customer ratings, and the number of complaints, while the expectation of rides completed would vary per month. The threshold for January is 210 trips on GrabTaxi, for example, Kell Jay said.

Drivers will be able to draw out the remaining funds left in their welfare account at the end of the year, he added.

GrabTaxi is present in seven markets across Southeast Asia — where it claims three million downloads and 620,000 monthly users — but Kell Jay said the company is “adopting a country-by-country approach” to the fund and is “currently studying” potential expansions.

GrabTaxi, which landed a $250 million investment from SoftBank in December, is Uber’s primary rival in Southeast Asia. Rocket Internet-backed Easy Taxi competes in a number of markets — though it has withdrawn from India and other markets — while Hailo is present in Tokyo and Singapore.

The move to offer drivers ‘welfare’ is the latest in a steady war of attrition to attract both customers and the drivers that transport them around.

Uber has a vehicle licensing program, which expanded into India last year but has not reached Southeast Asia yet. To date, Uber and GrabTaxi have sparred by racing to launch new expansions and offering aggressive price cuts/promotions across Southeast Asia, now it looks like the rivalry to recruit and retain drivers in the region will increase too.

GrabTaxi is one of three taxi-hailing app companies in Asia that is backed by Japanese telco giant SoftBank. BuzzFeed recently reported that there are plans for an alliance between the firms, and minor U.S. player Flywheel, though SoftBank said it has no immediate plan to link them up, according to a statement given to us last week.

Nonetheless, information sharing between portfolio companies is common, and seems likely that SoftBank-backed Ola (India) and Kuadi Dache (China) will be be keen observers of this GrabTaxi pilot.